PokerStars Owner Pays $4.7B to Enter Sports Betting Market
The Stars Group (TSG), which runs the popular online poker site—PokerStars— recently paid US$4.7 billion to acquire Sky Betting & Gaming (SBG) from CVC Capital Partners and Sky Plc. to grab hold of valuable sports betting solutions.
The deal between The Stars Group and Sky Betting & Gaming will help provide PokerStars owner with sports betting solutions that will help its brands to tap the UK market, one of the largest regulated gaming jurisdictions across the globe.
Rafi Ashkenazi, chief executive at TSG, said:
“The acquisition of Sky Betting & Gaming is a landmark moment in The Stars Group’s history. SB&G operates one of the world’s fastest growing sportsbooks and is one of the United Kingdom’s leading gaming providers. SB&G’s premier sports betting product is the ideal complement to our industry-leading poker platform. The ability to offer two low-cost acquisition channels of this magnitude provides The Stars Group with great growth potential and will significantly increase our ability to create winning moments for our customers.”
Sports Betting Options Are Vital to TSG’s Growth
Sports betting will be a major factor among online gaming brands in the future, especially when sports betting become legal in certain US states. TSG will be one of the major gaming brands to provide sports betting to a newly opened market once the US Supreme Court repeals the Professional and Amateur Sports Protections Act 1992 (PASPA). While TSG is not focusing on the US market at this time, the country’s sports betting market will play an important role to the poker brand in the future.
Simon Holliday, founder of H2 Gambling Capital, said:
“The US sportsbetting Supreme Court case is obviously a big part of the potential upside, with Star’s old database, SBG’s strengths and their track record solely in the U.K. Even without the U.S., SBG is just starting to launch in other regulated markets.”
The acquisition deal allows the online poker brand to increase its player base for its online gaming sites like PokerStars. According to SBG, it services more than two million active customers within regulated markets like the UK.
How TSG Bought SBG
To close the acquisition deal with SBG, TSG paid US$3.6 billion in cash and about 37.9 million-recently issued shares that are worth US$1.1 million. This amount represents about nearly 20 percent of TSG’s outstanding and issued common shares.
Richard Flint, chief executive officer of SBG, said:
“We are delighted to join forces with The Stars Group. We have had a fantastic last few years and would like to thank CVC and Sky for supporting us in becoming a leading online operator in the UK. This transaction allows us to offer our best-in-class products to a truly global audience. We’re excited about our future together.”
The acquisition deal is waiting on the green signal of the regulating bodies from both brand’s respective jurisdiction. This deal should be closed in Q3 2018.